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Econ Unit 1 25 Flashcards | StudBud
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Econ Unit 1 25
Econ Unit 1 25
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Questions
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Answers
1
In the Circular Flow Model, what “flows”
from
Households
to
Firms in the
Factor Market
?
money
products
goods and services
land, labor, and capital
2
Which of the following is NOT a problem associated with centrally planned economies?
Lack of incentives for workers
Poor quality goods and services
Shortages of consumer goods
Unemployment
3
In our society, choices are made primarily by
All of society through voting
Workers
Government
Individuals acting as consumers and voters
4
In the Circular Flow Model, what “flows”
from
Firms
to
Households in the
Product Market
?
land, labor, and capital
money
goods and services
factors of production
5
The struggle among various producers for consumers’ business is called
competition
regulation
advertising
incentive
6
A worker’s education is part of which “Factor of Production?”
physical capital
technology
human capital
land
7
Which of the following is a characteristic of a traditional economy?
Children tend to have the same jobs their parents did.
Communities tend to be fast growing.
They are based on light industrial production.
They have a high standard of living.
8
The purpose of the Production Possibilities Graph is to
show alternative ways to use an economy’s resources
tell farmers how many watermelons to plant
help engineers come up with new production techniques
show how a factory can use its workers in different ways
9
Which of the following is NOT considered “land”?
a river
a tree
a tractor
soil
10
Economics
is the study of how individuals and societies make choices
does not affect our everyday lives
how people spend their money
is one of the physical sciences
11
In what kind of economy does the government make all the decisions?
traditional
market
mixed
centrally planned
12
Which of the Three Key Economic questions does the market price system help to answer?
How should goods and services be produced?
Who consumes the goods and services produced?
How many goods and services should be produced?
What goods and services should be produced?
13
As a result of scarcity
People must pay transaction costs.
People consume inferior goods.
People must find substitutes.
People must make choices about how to allocate their resources.
14
Scarcity
does not apply to businesses
can be eliminated through cooperation among individuals
applies to all individuals rich and poor
applies only to the poor
15
Countries often have to choose between producing military or consumer goods, the trade-off economists call
guns or butter
export or import
a Free Market Economy
farm goods or factor goods
16
Which of the following will cause the production possibilities curve to shift outward?
A decrease in physical capital.
A reduction in the size of the labor force.
New technology.
A worker’s strike.
17
What is the opportunity cost of a decision?
the best possible way the question could have been decided.
the different ways that a different person might have made the decision.
the most desirable alternative given up when the decision was made.
the series of alternative decisions that could have been made.
18
According to economists, people are motivated by
opportunity costs
incentives
choices
trade-offs
19
The Factors of Production include all of the following
EXCEPT
human capital
money
land
labor
20
How would you describe an economy that uses its resources to produce the greatest possible number of goods and services?
free
efficient
globally aware
underutilized
21
Which of the following statements about the production possibilities curve is NOT true?
It illustrates options for only one good.
A point outside the frontier indicates an economy is producing efficiently.
A trade-off exists along the curve.
A point inside the frontier indicates the economy is underutilizing.
22
Which of the following is NOT one of the three questions all economic systems must address?
How should goods and services be produced?
How should goods and services be paid for?
What goods and services should be produced?
Who consumes goods and services?
23
The incentive manufacturers/businesses have to sell their products is
freedom
profit
competition
customers
24
Economists maintain that an individual will usually make decisions that promote the best interests of
his race
his gender
himself
his class
25
Which economic system best describes the Chinese market system?
Centrally Planned
Free Market
Mixed, but more free market
Mixed, but more centrally planned
